Home Energy Magazine Online January/February 1998

New Software Helps Sell Energy-Efficient Homes

Figure 2. The program then calculates the additional mortgage costs of an Energy Star home, compared with the utility savings. The onscreen graphic depicts what the net savings would be each month.

You load the self-contained software into your computer, put in the numbers about the home and the buyer, and click your mouse on one of the icons. Instantly you get easy-to-read graphics on customized house and financing scenarios, cash flow and mortgage payment analysis, and energy upgrade costs versus savings. The Environmental Protection Agency's (EPA) new Energy Star Home Calc software program is designed to help realtors and builders sell the benefits of investing in energy efficiency. At the point of sale, it shows the client the more-value-for-less-cost Energy Star sales strategy. The software is the EPA's latest attempt to convince people to pay the premium to invest in an Energy Star home.

The Energy Star Home Program is voluntary. The EPA develops partnerships with builders who agree to build homes that are 30% more efficient than similar homes that just comply with the Model Energy Code. The efficiency level is equivalent to that of a Home Energy Rating System (HERS) five-star home. Builders decide how to meet performance levels based on upgrade recommendations provided by the EPA.

The Home Calc software shows buyers that even though energy upgrades mean a higher monthly mortgage payment, the decrease in monthly utility costs is more than the mortgage increase, leaving the home buyer with a positive cash flow every month. We are on a mission to get consumers off of first cost as far as making a product decision, says Sam Rashkin, Energy Star Homes manager for the EPA, who spearheaded the making of Home Calc. ICF Incorporated in Fairfax, Virginia, took Rashkin's suggestions and turned them into a four-disk software program for Windows.

Home Calc graphically explains the rates of return realized on an Energy Star home throughout the entire period of ownership. The program also shows how homeowners can use the monthly energy savings to finance a larger home or add more amenities.

The EPA has been showing Home Calc all over the country at builder trade shows. We have received a lot of positive response that this is exactly what people are looking for, but have never been able to find, says Eric D. Werling, an ICF Incorporated energy efficiency consultant.

Home Calc is also interactive, allowing builders and vendors to personalize calculations and graphs with their logo. Screens in the program can be printed for handout to customers. It has clip art graphics that can be loaded with the utility or builder logo and added to the EPA logo, says Rashkin. The builder can also customize the program to fit his own homes and prices. Every week you can change the interest rates on loans and edit the program.

John Masiello of Florida Power Corporation has been through the program and says it is a good example of how the government can help promote energy efficiency. We need to look at energy as an investment, Masiello says. With other investments, like stock, there is an element of risk. There is very little risk in energy efficiency, and this program helps identify and minimize that risk. I think this is a good tool to aid buyers, builders, and contractors in determining what is going to be the most cost-effective investment in the home.

If builders or realtors do not have a computer to run the Home Calc program, they can use a hand calculation method with charts. There are still some people who do not have computers on site, and we want to make sure we have answers for both situations. So there is a companion hand calculation method, Rashkin says. The hand version, which can do about 60% of what the computer version does, has interest payment tables and rate of return tables. The key things you can't do with the hand method are instant affordability answers or what-if situations on a dime.

Three hundred builders, 180 allies (organizations mutually interested in energy-efficient utility programs), and 50 to 60 financial offices are currently using the Home Calc program. For more information on the software or the Energy Star program, call (888) STAR-YES.

--Deborah Rider Allen

Deborah Rider Allen is a freelance writer in Richmond, Virginia.

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